These actual events took place a few days ago. It is a real story of one cryptocurrency trader who got fooled accidentally. Because of a few tiny events, he lost 17.500 USD, with no possibility to get them back. He contacted me after my blog, post-Gandalfs Scam Report Vol III: No Face, no Case.
As promised, he will remain anonymous, but these events happened as accurately as the following article is.
My greatest mistake in crypto played out like this: I'm a developer in the space myself, and my coworker told me that about a site (bitniex.com) that had pretty decent sale-prices. So as I am usually confident in my coworker's judgment (this is where I was wrong), I hopped into the site, ZERO googling, with a small deposit of 150USDT - one could call it FOMO (Fear of missing out). Everything seemed to be okay, nothing special.
Then I transferred assets worth 17,500 USD to the site - I did not execute a single trade and tried to withdraw from the site since I noticed that the investments I transferred seemed to rise even WAY higher than before as they reacted to my deposits.
I noticed that the ETH-address associated with my Bitniex account was initiating no transactions but later sending parts of my assets to the address mentioned at the end of this blog post. (All of them are now there, and they are slowly moving them and selling through transferring them to various new accounts which execute trades on FixedFloat)
I contacted their zendesk "support," and they told me that my account is frozen due to arbitrage rules on the site, and I have to upgrade to an institutional account to access my funds. The institutional account version requires a total deposit amount of 75,000 USD, and as implied - it just further scams you. The rules stated that making arbitrage trades are forbidden and will cause your funds to be frozen. But the thing is - zero trades were made.
So now I got to track the scammers at some level was that they sent the ETH to my Bitniex eth-address to transfer my assets out. That address had received funds from Binance and led to many other accounts that received funds from exchanges like FixedFloat and BitMEX.
Following the transfers from that account, it was pretty clear that this was not their first rodeo. I think they had done projects like this before since funds were transferred and used the same way before this scam.
After I gathered a list of wallets with transfers in the exchanges and sent it to them by email or support, answers are listed later on.
There is no way to get the funds back since:
1. They are creating new ETH addresses to send the funds to the address: https://etherscan.io/address/0x17d8b3f4c55fd45512d73dbb1ab15f400a5bd28c
2. They convert the funds from those addresses through FixedFloat to anonymous currencies like Monero, Dash, ZCash. You can use the wallet addresses since it's a public blockchain, after all.
Binance answered within an hour to my request. They got their addresses blocked for 48 hours - if I do not inform the authorities to contact Binance, they will be enabled again. Since most of my assets are at FixedFloat - I deemed further actions redundant and only causing me to waste more time on the issue.
FixedFloat answered my initial request in less than 30 minutes. They told me that since the trades are in anonymous currencies, they cannot further track them. So hearing this, I asked them can they backtrack the addresses which originate from the address above and block all transfers for those addresses. I haven't received an answer to this day.
BitMEX: No answer so far, even though the whole scam-platform is a copy from them and there are linked exchanges of funds between the scammers and BitMEX.
Here is their collective fraud address (where, e.g., my 1000 link resides) https://etherscan.io/address/0x17d8b3f4c55fd45512d73dbb1ab15f400a5bd28c
Here is a list per exchange:
FixedFloat https://etherscan.io/address/0x3454ccdd6d6853387425d2063758df1983e14582 https://etherscan.io/address/0x17d8b3f4c55fd45512d73dbb1ab15f400a5bd28c https://etherscan.io/address/0x59bc41cbabe0768da419fa6e6d5c7774efda19be
BitMex (they copied GUI from here) https://etherscan.io/address/0x56c9d65f2ac0332669618a1aaad1b4ea2c3283fa
Binance https://etherscan.io/address/0x2a7980a62c87cb4da492615682df699c45d6fc8b https://etherscan.io/address/0x0f368aada090cb603abc237acb93ac5d6c0a403b https://etherscan.io/address/0xc776cffcb53d1ccb77a4a7a310d49d826b52957e
The takeaway here is, trust only yourself and nobody else in crypto-space, hold your FOMO, and if something seems too good to be true - don't do it. Also, Google it - I didn't and paid the price.
Thank you for sharing your experience with us. I hope your stolen assets don't go unnoticed with this writing, and inspire others to tell their experiences and knowledge on the critically important subject.
Ethercan.io is a great place to track transactions and addresses and the tokens on the ethereum network. It is as easy to use as it gets. Just fill in the address you want to track, and it delivers all the information to you.
The idea that the exchanges would backtrack the address with the "dirty coins" is superior and should be done as a standard method when dealing with accidents like this. This way, it would be almost impossible for the scammer to tumble his / her tracked tokens to anonymous assets like Zcash, Dash, or Monero. It would involve, of course, all the exchanges mutual co-operation and work against cybercrimes and crypto thieves.
Even further, we could call to arms all the wallet developers, that they install an automated alarm system into every wallet, that makes alarm or froze the wallet every time the pointed address is being used or tried to use. For the time of the investigation, of course.
I opened the forum on the cryptogandalfs web page, where I hoped to discuss the crypto scams, facts, debates, and solutions. Here's a link to it:
https://www.cryptogandalf.com/forum
Please share this article with anyone you think might need it. Let's keep on fighting the crypto villains together.